The Prospect of Prospecting

Disregard this blog if you run one of those rare businesses in which you wait for the phone to ring or the website to bring the orders or the email to bring the RFQs. Disregard this blog if the market comes clamoring to you and lines up for service.  Most of us have enjoyed brief seasons of profitable market dominance only to be discovered by competitors eager to pick away at our customer base and draw us into a profit eroding game of tag.

Perhaps you innovate and stay ahead of your competition through product development and value-added service only to find that costs rise and customers still expect value regardless - and profits are squeezed. Maybe you rely on residual sales and contracts. All of these will be tested.

Sustainability requires that new clients enter the mix as old ones are allowed to be drawn away to alternatives that you chose not to chase. And so every business has to contend with the prospect of prospecting the universe of potential clients and narrowing them down to sales.

As business organizations refine and become more lean there emerges an imperative of three performance consciousness components. Cross-functional management teams must visualize, anticipate and communicate on a common frequency. If profitable revenues are the goal, then the process of customer identification and conversion to a sale is everyone’s concern and priority. And so it is important that everyone understand the process of prospecting.

Enter the humble Sales Funnel diagram to help everyone visualize that process. Do a Web search of “Sales Funnels” and you will be met with all sorts of versions. One is right for your business. The concept is simple – wide at the top and narrow at the bottom – many prospects enter, they are qualified and pursued and a few convert into customers. Every business type has a ratio model that seems to result; e.g. 100 prospects narrows to 30 qualified and ready prospects, that narrows to 5 that will participate and accept a proposal resulting in 1 that will buy.

Successful after-market customer maintenance aided by the proliferation of information sharing and communications mediums brought on by the internet and social media has transformed the traditional sales funnel into a useful converging/diverging shape that facilitates customer retention, up-selling, conversion of customers into evangelists for your company and the attraction of qualified network prospects from those same customers. Intake on one end, Uptake on the other.    

Here is a sales funnel diagram version that works for a client of mine;

Let’s apply some detail.

From the “Universe” are gathered prospects from a variety of gathering methods such as advertising, active sales prospecting solicitation, referrals and the like. Based on the proven conversion model for your type of business the number of required “Universe” prospects to be gathered will vary for the success rate goal you set. You’ve got to KNOW and DO the numbers!

Leads are “Qualified” by identifying need, determining that the prospect has the resources to make the purchase, understanding the competitive landscape you are up against, exploring buying influences particular to the customer and understanding their purchasing decision process. At this point it is necessary to involve the potential customer in the process so that they are investing in the outcome along with you. No investment in the process on their part lowers the potential for closure.

“Positioning To Win” involves a detailed validation of the need and the budget to meet the need, establishing buyer and seller roles and responsibilities in the process, establishing and adhering to a scheduled trajectory toward closure, aligning your solution to the need (and conducting field trials to prove the fit), continued building of the relationship with both parties investing in the process and rooting out pitfalls that lead to “leaky funnels” – such as; the person you’re dealing with is not really the decision maker, you’re dealing with a nice person who just can’t say no … until you ask for the order …

The “Proposal” must; be submitted when promised, be clear, stay within scope (no surprise add-ons or hidden agendas), leave nothing unanswered, be visual (use customized sketches, pictures and diagrams) to facilitate comprehension, be bottom line sensitive, be easy to execute, be clear on next steps if executed.

The “Closing” process involves; negotiating for a win/win and ensuring no buyer remorse by making a great first impression and following through with fresh energy, positive relationship building and clear point-of-contact establishment. This phase proves to the customer that their decision and the process that led to it were worth it. Customer conversion to evangelist starts here.

Post closing, attention on relationship development should ramp up and lead to eventual up-selling and qualified network referrals (inward funnel leaks are desirable). Don’t spike the ball – wrap it in a bow and gift it to the customer. Think WIN WIN !!

Happy funneling & all the best!

Bill